The Global Contactless Smart Card market will grow at a CAGR of 33.5
percent during the period 2013-2018

Smart cards are pocket-sized cards that are generally made of plastic
and embedded with integrated circuits. They are mainly used for
identification, authentication, data storage, and application
processing. Smart cards are mainly of two types: contact-based and
contactless. Contactless cards generally use radio-frequency induction
technology for data and information transfer. The rate of data transfer
can vary between 106 kbits/s to 848 kbits/s. Communication is
facilitated byan antenna. These cards use inductors to capture the
incident RF interrogation signal, which is rectified and used to power
the card's electronics. In other words, signals are sent to the card
reader, which then transfers the data and information into the system.
Contactless smart cards are more user-friendly than contact-based smart
cards.

The growth of the Global Contactless Smart Cards market is driven by
several factors, of which the growing need for a tamper-free system is
one of the major drivers. Generally, cards embedded with magnetic tapes
only store information about end-users' accounts. These cards can be
easily tampered with, resulting in loss of information or data. However,
contactless smart cards store information that can only be accessed with
a pin code, which is difficult to decode, thereby protecting end-users'
data.

Further, the report states that high initial deployment and replacement
cost is one of the major challenges faced by the vendors in the market.
Regions such as South America and the APAC region have limited vendor
penetration and few local players. As a result, the market is controlled
by a small group of vendors, leading to low competition.